MANILA — The Asian Development Bank will be discussing its new long-term corporate strategy at its annual ADB Business Opportunities Fair happening this week at the bank’s headquarters. Sessions will include ADB’s changing business processes and new procurement opportunities.
Here are four things to know ahead of the fair:
1. New business processes
Adopted in July 2018, Strategy 2030 sets out the bank’s new operational priorities and targets for the next decade, including on climate change and gender equality. It also lays out bank plans to modernize its business processes and improve operational efficiency. This includes changes in its procurement framework, which the board approved in 2017 and currently being implemented.
President Takehiko Nakao shares what ADB aims to accomplish under its new strategy.
The bank has taken steps to streamline some of its procurement procedures, including reducing the number of forms borrowers need to submit to the bank prior to the approval of consulting transactions. The original five forms are now down to three or fewer, depending on bank assessments. The bank is also no longer requiring shortlists of consulting firms be limited to just six and no longer limiting the list to two firms from any one member country.
“We found that this one-size-fits-all approach was not very practical or realistic. So now we have a principles-based approach. And the most important principle is that we satisfy ourselves that there is sufficient competition in the shortlist to meet the needs of the particular project in a particular country,” said Deborah Stokes, ADB vice president for administration and corporate management.
The bank has also entered into an alternative procurement arrangement with the World Bank that allows borrowers to follow only one of the two banks’ procurement procedures for co-financed projects. The process to determine which co-financier procurement procedure to follow will depend on several factors for each project, such as bank relationship with the borrower, available technical experience, financing amount, and country or sector strategies.
The bank is hoping to enter into similar agreements with other partners in the future.
Last year, ADB's board of directors approved a new set of financing facilities and modalities meant to speed up project preparation and implementation.
“Previously, projects had to follow the procedures of all the involved partners, which was certainly a burden for our clients. So having these arrangements in place, we'll make implementation of co-financed projects so much easier, and we hope will encourage further collaboration and co-financing,” Stokes said.
“We'll continue to look at opportunities where we can streamline our processes and cut red tape,” she added.
2. IT: An institutional business opportunity
One of the new sessions at this year’s Business Opportunities Fair is dedicated to ADB’s institutional needs. This will identify different areas where suppliers can provide the necessary goods, works, and services to help keep bank headquarters and field offices running smoothly.
Institutional opportunities are likely to include projects related to the bank's IT systems. In October 2018, the bank approved its Digital Agenda 2030, and the bank is currently in discussion with different ADB departments on the initial IT-related projects.
“We want to improve our data consistency and accuracy. We want to enhance cybersecurity and our resiliency, and improve knowledge sharing. So we want to make those IT investments to strengthen our productivity and our efficiency, with the ultimate goal of supporting developing member countries and our shareholders more effectively,” Stokes said.
The first phase of the digital transformation includes 16 projects budgeted at $118.3 million. This is targeted to be implemented between 2019-2023.
3. Transport, energy, health, and education
At the end of 2018, out of total loan and grant commitments of $31.6 billion, Stokes said ADB had a total uncontracted portfolio of $29.8 billion, or approved funds for projects that have not yet been awarded to any particular organization or individual.
The majority of the projects have likely not been opened for bidding yet, and this means there’s a huge amount of business opportunities to be made available to interested contractors and consultants, including NGOs.
Some of the largest opportunities can be found in India, Bangladesh, Indonesia, China, and the Philippines; these countries are the bank’s top five clients in terms of lending volume in 2018, Stokes said.
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In the Philippines, the lending volume includes the bank’s $408 million financing package for the rebuilding of the conflict-torn city of Marawi in Mindanao, and other bank support for the government’s infrastructure-heavy agenda called the “Build, Build, Build” program.
As for sectors, the bank’s uncontracted portfolios remain largest in transport and energy, but there are also growing opportunities in health and education. Bank uncontracted portfolios in health and education increased from 9 percent in 2017 to 11 percent in 2018, Stokes said.
“We're seeing a growth in the social sectors and if you look at the operational priorities under strategy 2030, we can certainly foresee that there'll be continued opportunities in a wide range of social-related areas of support,” Stokes said.
4. ADB private sector operations area of ‘high priority for recruitment’
“In the short term I can mention that the growth of our private sector operations is an area of continued high priority for recruitment, together with other areas of ADB that support private sector operations, including risk management, but also legal advice,” Stokes said.
But she added that the bank will continue to “recruit in a wide range of areas.”
According to ADB, for 2020-2021, hiring priorities will also be given in the sectors of agriculture, natural resources and rural development; industry and trade; information and communication technology; and public sector management.
Update, March 27, 2019: This article has been updated to clarify that the changes to ADB’s procurement framework are currently being implemented and that institutional opportunities are likely to include projects related to the bank's IT systems.